Fiscal Showdown Puts Money on the Sidelines

Sticking close to cash is the position of choice for the coming week as bond investors avoid holiday-thinned trading conditions and the unpredictability of U.S. politics.

As negotiations in Washington to avoid the so-called fiscal cliff drag on, investors are unwilling to take sides on even long-term Treasurys. The late-Thursday decision by Republican leaders in the House to cancel a vote on a bill aimed at partially averting the...